The Supreme Court Says Rules Are Rules: Ballard v. Commissioner of Internal Revenue

Abstract

ll courts issue rules of procedure that instruct prospective litigants in every phase of a case, from the initial filing through discovery and trial to the decision, and even what will be included in the record on appeal. In the recent case of Ballard v. Commissioner of Internal Revenue, 125 S.Ct. 1270 (2005), by a 7-2 vote, with an opinion by Justice Ginsburg, the United States Supreme Court upheld the perhaps novel concept that courts, in this case the United States Tax Court, must follow, and adhere to, their own promulgated rules. The United States Tax Court has a powerful influence on tax policy; it is one of three forums, along with the United States District Court and the United States Court of Federal Claims, where taxpayers may contest an assessment by the Internal Revenue Service. Because no prepayment of the assessment is required for someone to proceed in the tax court, significantly more cases are filed there than in either of the other courts. The tax court consists of nineteen full-time judges, appointed by the president and confirmed by the Senate, for a fixed term of fifteen years. The chief judge of the tax court has the authority to appoint special judges to deal with any matter pending before the tax court “in accordance with these Rules and such directions as may be prescribed by the Chief Judge” (Tax Court Rule 180). In cases involving assessments exceeding $50,000, the special judge tries the case and then submits a report to a regular tax court judge, who has the authority to adopt the special trial judge’s report, or the tax court judge may “modify it or may reject it in whole or in part,” with “due regard given to the circumstance that the Special Trial Judge had the opportunity to evaluate the credibility of witnesses, and the findings of fact recommended by the Special Trial Judge shall be presumed to be correct” (Tax Court Rule 183 (c)). The final opinion issued by the regular tax court judge is a collaborative second report, which is “agreed to and adopted” as the opinion of the tax court. Through the year 1983, a report by a special judge was made public and was included in the record on appeal. This allowed litigants to see why and how the regular judge’s ruling may have differed from that initial opinion. Since 1983, however, the special judge’s opinion has been withheld from the litigants, and the public, and excluded from the record on appeal. Although the regular tax court judge overseeing A